Jerry, your fuel filter looks like it was installed backward. Flow should follow the arrow from the tank to the carb.
I wouldn't reverse this one if it's been on for a while though. Any gunk it has stopped would go straight to your carb.
Just remember for next time you change it.
I would definitely adjust the installation so that the valve and filter and fuel lines are not touching the head or the cylinder. I'm using a much much smaller filter from Briggs and Stratton. And my fuel line is short so that it's a straight shot from tank to filter and carb.
If things are running right, you should easily exceed 20 mph. 30-40 is reasonable. That carb may be gunked up or mis-adjusted. Pull it and look inside as you roll the throttle to be sure your throttle is giving you full travel of the slider and needle. The cable adjustment looks like it's about out of travel as it is. I'm not sure why it's like that. Maybe it's already stretched badly?
But if I bought this and had seen the gunk coming out of the tank that you describe, and it wasn't running great, I'd start with disassembling the carb and cleaning it very well. Make sure the jets are all clean, and that the float is adjusted right. And that the throttle is working over it's full travel. Maybe the throttle cable was not kept lubricated and has been stretched from applying too much force to move it over time?